South Carolina Contractor Dispute Small Claims: How to Sue for a Deposit or Unfinished Work

You paid a contractor a deposit, they disappeared or did substandard work, and now they won't return your money. This is one of the most common disputes in South Carolina Magistrate Court — and one of the most straightforward to prove if you have the paperwork.

Does Your Claim Fit in Magistrate Court?

If the amount you're trying to recover is $7,500 or less, Magistrate Court is your forum. This covers most residential repair and renovation deposits. The $7,500 limit applies to the amount you're claiming, not the total value of the contract.

If you paid a $4,000 deposit on a $15,000 kitchen remodel and the contractor walked off without doing any work, your claim is for the $4,000 deposit — well within the limit.

If your damages exceed $7,500, you can waive the excess and stay in Magistrate Court (cap your claim at $7,500) or file in the Court of Common Pleas for the full amount. Most people choose the speed and simplicity of Magistrate Court.

Identify the Right Legal Entity

This is the step most people skip — and it causes problems. You need to sue the correct legal entity. A lawsuit against the wrong party can be dismissed or produce an unenforceable judgment.

Sole proprietor using a trade name: Sue the individual plus the trade name — "John Doe d/b/a Doe Construction." The trade name alone is not a legal entity.

LLC or corporation: Sue under the exact business name registered with the South Carolina Secretary of State. Look it up on the Secretary of State Business Entities Online portal. While you're there, get the registered agent's name and physical street address — you'll need this for service of process. A P.O. Box won't work.

If the contractor gave you a business name that doesn't match anything in the Secretary of State records, don't assume that the name identifies the right defendant. Confirm the contractor's legal identity before filing.

Build Your Evidence Package

Contractor cases hinge on documentation. Before you file, gather:

• The written contract or work order — a text-message exchange may help document the agreed scope and price
• Proof of payment — bank statements, cancelled checks, Venmo/Zelle screenshots, or receipts showing the deposit amount and date
• Communications — emails, text messages, and letters between you and the contractor, especially any where they acknowledged the work was incomplete or promised a refund
• Photographs — before-and-after photos of the work site, showing what was and wasn't completed
• Repair estimates — if you hired someone else to finish or fix the work, get at least two written estimates or the actual paid invoice from the replacement contractor

Send the Demand Letter

Before filing, send a written demand letter via certified mail, return receipt requested. Give the contractor 10 to 14 days to refund your deposit or complete the work. State clearly that you'll file in Magistrate Court if they don't respond. For a residential construction-defect claim, this short demand is separate from the notice required by S.C. Code § 40-59-840: serve written notice at least 90 days before filing and allow the contractor an opportunity to respond.

For ordinary contract claims, a demand letter isn't generally required, but it demonstrates good faith and becomes part of your evidence. A residential construction-defect claim has a separate 90-day written-notice requirement under § 40-59-840. Many cases settle at this stage when the contractor realizes you're serious.

File and Serve

Complete Form SCCA/701, attach your evidence in duplicate, and file in a county where at least one defendant resides or where the most substantial part of the cause of action arose. For a domestic corporation or LLC, venue may also be where it had its principal place of business when the claim arose or where the most substantial part of the alleged conduct occurred. Pay the $80 filing fee.

Serve the contractor through the sheriff, a private process server, or certified mail with restricted delivery. If the contractor is an LLC, service goes to the registered agent. All service must happen within 120 days of filing.

At the Hearing

Bring three copies of everything. Present your case chronologically: the agreement, the payment, the contractor's failure to perform, your attempts to resolve it (including the demand letter), and your damages.

If you hired another contractor to finish the job, that contractor may need to testify about the state of the work and the cost to complete it. Written statements from people who don't appear are hearsay and generally won't be admitted.

The South Carolina Small Claims Filing Guide covers the full process from demand letter through judgment collection, with templates and deadline tracking specific to contractor disputes.

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